Should I Accept the First Settlement Offer From an Insurance Company?
If you have suffered an injury accident that you believe might be somebody else’s fault, you should at least consider filing a personal injury claim. If you do, you will likely need to deal with an insurance company at some point. This insurance company will offer you a certain amount of money to settle your claim.
You might be wondering, “Should I accept the insurance company settlement offer?” The answer is probably no.
Components of Compensation
Some of the basic components of compensation for a personal injury claim include economic damages and non-economic damages:
- Medical expenses;
- Lost earnings;
- Out-of-pocket expenses; and
- Non-economic damages such as pain and suffering and emotional distress.
You might also qualify for punitive damages under Texas law, but insurance contracts almost always exclude punitive damages from coverage.
Insurance Companies Like To Play ‘Lowball’
In ‘lowball,’ the insurance company issues a pathetically low initial offer. If your claim is worth $225,000, for example, they might offer you $50,000. That might sound like a lot until you consider:
- Your medical bills total $40,000 so far, but might add up to more later;
- You lost $20,000 in wages so far, and you still haven’t returned to work; and
- The insurance company settlement offers you nothing for pain and suffering and other non-economic damages.
That leaves you at least $10,000 in the hole if you accept the settlement, without even counting pain and suffering damages. Pain and suffering damages are often worth several times the amount of medical expenses. Nevertheless, hope springs eternal. The insurance company’s hope is probably that:
- You don’t have a lawyer, thereby putting the insurance company in a stronger position than yours, especially psychologically;
- You’re afraid to go to court, thereby robbing yourself of all bargaining power;
- You don’t know the value of your own claim; or
- You are so desperate for cash that you will accept even a lowball offer in exchange for quick payment.
Don’t let them get away with playing lowball. Hiring a personal injury lawyer is free unless you win compensation, and your lawyer might be able to help you pay your bills without forcing you to resort to a lowball settlement.
Adding an Abitrary Deadline to Your Settlement Offer
It is true that an insurance settlement first offer is only valid until the insurance company revokes it, as long as you didn’t accept it prior to that point. That’s basic contract law.
Nevertheless, you still have the power to file a lawsuit against them any time before the statute of limitations deadline expires (usually two years after the accident). Ultimately, it’s Texas personal injury law that sets the relevant deadline, not the insurance company.
Personal Injury Lawyers Are Trained Negotiators
If your lawyer has been involved with your case since before the insurance company made their first offer, they will have already sent the insurance company a demand letter. In this case, you can be sure that the insurance company’s first offer is considerably higher than it otherwise would have been.
Assuming, however, that you didn’t contact a lawyer until after the insurance company sent you its initial offer, here are some of the things that a lawyer can do for you:
- Draft and send a demand letter/counteroffer;
- Gather evidence to strengthen your claim;
- Tell the insurance company to direct all further correspondence to your lawyer, not you;
- Negotiate on your behalf;
- File a lawsuit;
- Help you gather evidence through the pretrial discovery process;
- Withdraw the lawsuit in exchange for a settlement; and
- Take your claim to trial if necessary.
Very few personal injury claims go all the way to trial.
Hiring a Lawyer Is a Way To Even the Playing Field With the Insurance Company
Insurance adjusters negotiate claims for a living. If you go up against one for a significant claim, the odds are the adjuster will “take you to the cleaners.” That won’t be so easy once you have hired an experienced personal injury lawyer to take your place at the negotiating table.
Contact the Personal Injury Law Firm of Parker Law Firm in Bedford for Help Today
For more information, please contact an experienced personal injury lawyer at Parker Law Firm to schedule a free initial consultation today. We have convenient locations in Fort Worth and Bedford, Texas.
Parker Law Firm – Fort Worth
209 N Hampton St,
Fort Worth, TX 76102
(817) 510-9400
Parker Law Firm – Bedford
2317 Plaza Pkwy #100,
Bedford, TX 76021
(817) 503-9200
